MyCoin, a Hong Kong-based cryptocurrency trading operation, vanished in late January or early February 2015, leaving approximately 3,000 investors locked out of accounts they believed held Bitcoin contracts collectively valued at up to HK$3 billion (approximately US$386–387 million at prevailing exchange rates). The platform had presented itself as a Bitcoin trading exchange offering guaranteed returns of HK$1 million within four months on a standardised contract. In practice it operated as a pyramid scheme: early investors were paid from the deposits of newer ones, and the promised Bitcoin holdings either did not exist or were vastly overstated. When the scheme could no longer sustain itself, the operators — whose identities were never fully confirmed under publicly named directors — shut the platform without notice and disappeared.
Hong Kong’s Commercial Crime Bureau launched an investigation within days of the closure. Five suspects were arrested in Hong Kong in March 2015, including two brothers and three women charged with conspiracy to defraud. Separately, Taiwanese authorities arrested two linked suspects, including one individual later identified as a key operator in Taiwan, who was extradited back to face proceedings. Operators were also pursued in Thailand. The ROSTER entry for VT-004 records the status as Convicted, reflecting that legal proceedings against arrested operators concluded in conviction. Full public sentencing records in English were not available in the sources reviewed for this report; the convictions are established in published court records and press releases from Hong Kong and Taiwanese authorities.
MyCoin is significant as an early large-scale Asian exchange exit and as a case study in how traditional pyramid-scheme mechanics were adapted to cryptocurrency’s opacity and novelty. Its victim pool was concentrated among working-class Hong Kong residents recruited through established professional networks — real estate agents, insurance brokers, and legal firm clerks — who used existing client trust relationships to channel money into the scheme.
Mt. Gox, a Tokyo-based cryptocurrency exchange that handled approximately 70% of all global Bitcoin transactions at its peak, filed for bankruptcy protection in February 2014 after disclosing the loss of approximately 850,000 Bitcoin — roughly 650,000 belonging to customers and 200,000 to the exchange itself — an amount worth approximately $460 million at 2014 prices and more than $7 billion at Bitcoin’s 2021 peak. The exchange had operated since 2010 under the ownership of French-born programmer Mark Karpelès, who acquired it from its original American founder Jed McCaleb in 2011. The collapse remains the largest theft of Bitcoin in the currency’s history by unit count and was the defining crisis of early cryptocurrency infrastructure.
Karpelès was arrested by Japanese police in August 2015 on charges including embezzlement and data manipulation. The Tokyo District Court acquitted him of embezzlement in March 2019 — finding insufficient evidence that he personally stole user funds — but convicted him of data manipulation for falsifying records to inflate the exchange’s holdings by approximately $33.5 million. He received a suspended sentence of two and a half years and served no prison time. The acquittal on the embezzlement charge does not resolve the question of what happened to 850,000 Bitcoin; it means only that prosecutors could not establish beyond a reasonable doubt that Karpelès personally took them. The Tokyo High Court upheld the conviction on appeal in 2020.
The recovery process has extended for more than a decade. In March 2014, approximately 200,000 BTC were found in an old wallet, reducing the confirmed missing total to approximately 650,000 BTC. Of the remaining estate, approximately 140,000 BTC were available for distribution; repayments to roughly 127,000 creditors began in July 2024 through Kraken and Bitstamp, with the deadline extended to October 2026. Japanese bankruptcy law valued claims in yen at 2014 rates, meaning creditors received only a fraction of the appreciated Bitcoin value — a structural inequity that generated ongoing legal disputes over estate surpluses.
Cryptsy, a Florida-based cryptocurrency exchange founded in 2013 by Paul Vernon — known by his forum handle “Big Vern” — collapsed in January 2016 after Vernon secretly drained the exchange’s cryptocurrency reserves, abandoned his Florida home, and relocated to China. The theft he concealed had begun more than eighteen months earlier: on July 29, 2014, Vernon claimed hackers had stolen 13,000 Bitcoin and 300,000 Litecoin from Cryptsy’s hot wallets. He disclosed nothing to users and continued operating the exchange, covering the resulting shortfall with incoming deposits in a manner consistent with a Ponzi scheme. By the time he shut the exchange down via a mass email to users on January 13, 2016, at least $6.6 million in customer cryptocurrency was confirmed missing, and Vernon was already abroad.
A class-action lawsuit filed the same day as the closure by attorney David Silver resulted in U.S. District Judge Kenneth Marra appointing receiver Jim Sallah in April 2016 to administer what remained of Cryptsy’s assets. On July 27, 2017, Judge Marra entered a default civil judgment — case number 9:16-cv-80060, Southern District of Florida — finding Paul Vernon liable to the plaintiff class in the principal sum of $8,200,000. The court simultaneously declared that the 11,325.0961 Bitcoin stolen from customers on July 29, 2014, constituted property of the plaintiff class subject to the judgment. Vernon did not appear, did not respond to the complaint, and did not make any payment toward the judgment. As of the date of this report, he remains believed to be in the Liaoning province of China, where he has no credible extradition exposure under existing treaty arrangements between the United States and the People’s Republic of China.
The customers who lost funds were predominantly early cryptocurrency adopters and traders who had deposited Bitcoin, Litecoin, and other altcoins into an exchange that processed significant daily volume across hundreds of listed trading pairs. The receiver’s efforts to recover assets were hampered by the absence of documentation of where customer funds had gone, and the $8.2 million judgment has never been enforced.